If You Like Your Pizza, Can You Keep Your Pizza?

Jeffrey H. Anderson

August 8, 2012 3:21 PM

In addition to raising federal spending (by a whopping 13 digits), federal taxes, health insurance premiums, and overall U.S. health costs, Obamacare would cause the price of pizza to rise. Politico reports that Papa John’s CEO and founder John Schnatter conveys that Obamacare would “result in higher costs for the company,” which he says would be passed on to customers. Schnatter says, “Our best estimate is that…Obamacare will cost 11 to 14 cents per pizza, or 15 to 20 cents per order from a corporate basis.”

Schnatter adds, “We’re not supportive of Obamacare….But our business model and unit economics are about as ideal as you can get for a food company to absorb Obamacare.” In other words, Obamacare would have an even worse impact on most other food companies — and their customers.

That’s because Obamacare would not merely mandate that Americans buy federally approved health insurance under penalty of law; it would also impose a myriad of costly mandates on American businesses. For the most part, Obamacare would make it illegal for individuals or families to purchase popular low-premium, high-deductible health plans (the kinds of plans that reduce health costs by giving consumers skin in the game). It would also make it illegal for individuals or families to choose popular plans that either don’t cover, or else charge typical copays for, contraception or the abortion drug ella — as the federal government would allow copays only for things like cancer treatments or heart medications (such is the federal government’s ability to weigh the relative importance of various medical procedures). But Obamacare would also impose a myriad of new mandates on businesses, many of which would give those businesses perverse incentives to avoid hiring more workers or to cut existing workers’ hours.

In the food business alone, the Wall Street Journalreports that Obamacare would add between $10,000 and $30,000 to the annual costs of each of the 14,000 McDonald’s restaurants in the U.S. The Journal adds that Subway, Burger King, and Dunkin’ Donuts went to Capitol Hill a couple of weeks ago to object to Obamacare’s mandates and the higher costs they would spawn. The Journal also offers this telling anecdote,

“Randall Tabor, who owns two Quiznos sandwich restaurants in Virginia Beach, Va., once aspired to triple the number of outlets he owns.

“But after the federal health-care overhaul passed in 2010, Mr. Tabor says, he shelved those plans. The law requires that employers with 50 or more full-time workers provide health insurance to employees by 2014 or pay a penalty. Mr. Tabor, who employs 36 people at his two Quiznos shops and another restaurant, wants to stay small so he doesn’t trigger the requirement.”

The Journal adds, “Other franchisees are looking at ways to avoid the [coverage] requirement by cutting workers’ schedules so they work fewer than 30 hours a week — the law’s definition of a part-time worker — since only full-time workers are counted toward the insurance coverage requirement.”

Earlier, the White Castle hamburger chain noted that a single provision of Obamacare would cut its net income in half — and then some.

Of course, some businesses would get waivers from some of these mandates — at the Obama administration’s discretion. In other words, when the administration is feeling magnanimous, or is suitably impressed with a given business’s — how shall we say it? — contributions to worthy causes, exceptions can be made.

Higher costs, less liberty, crony capitalism, and a massive consolidation and centralization of power, money, and control in Washington, D.C. What’s not to like about Obamacare?